5 Reasons to Write a Business Plan

new-years-resolutionThe tradition of stating a New Year’s resolution is interesting. As the clock nears 12 midnight on December 31st, a popular topic is “what will you accomplish in the new year?” It makes sense … when a significant milestone event occurs, it is natural to reflect on what we have already accomplished, and what the future might hold.

I suspect, however, few New Year’s resolutions actually come true. There are many reasons for my belief, ranging from the alcohol consumed at the time (I said what?) to the motivating factor behind the pronouncement (showing off on a first date?) to simply how much thought was put into the statement. Most importantly, however, is the fact that these resolutions are seldom documented in writing.

Research suggests that the simple act of writing down a goal has a profound impact on actually achieving it. According to a study presented in an article published by the Chronicle, the student-run newspaper of Duke University, it was concluded that:

  • 80 percent of Americans say they don’t have goals
  • 16 percent do have goals, but they don’t write them down
  • Less than 4 percent actually write down their goals
  • Less than 1 percent review them regularly – but – this small percentage of Americans that do end up earning 9X more over the course of their lifetime

These figures are breathtaking. This research suggests 99 percent of Americans are missing out on significant earnings potential, based on the simple fact that they are not writing down their goals and reviewing them. Why might this be the case?

The Importance of Documenting a Plan

My theory is that the act of writing down, and ideally sharing a goal with others, makes you accountable. And, it makes it harder to forget or “de-prioritize” those goals, which you initially set out to accomplish.

Pictures are another helpful technique to be more committed to accomplishing your goals. Do you want to purchase a home? Find a picture of your dream home as your wallpaper on your laptop or PC. Then every time you use your computer you will be reminded of that goal. The logic and psychological effect is the same if you write down your goals.

A Written Business Plan as a Documented Goal

Those interested in starting their own business face a huge challenge, one that can be quite difficult to accomplish. Any help you can do to make this goal become a reality is probably worth investing in, which brings me to this list of 5 reasons why you should write down a business plan if you are serious about starting a new business or expanding an existing one:

  1. Writing a business plan makes you more committed – writing down your plan, and following through with it all the way through funding will keep your momentum moving forward; the act of writing it down forces you to take your plan more serious and puts the odds of success more in your favor
  2. Documenting your plan and sharing it with others holds you more accountable – you simply can’t hide when you go public with these types of statements, which will be a great motivating factor to completing your vision and sticking it out
  3. Better articulation of your vision for a new business creating a detailed plan that is in writing forces you to think in a more comprehensive manner, to better evaluate if your idea could actually work; there is a big difference between talking about an idea and documenting it in writing
  4. Developing a cash flow statement tied to your business idea helps you to better understand how to monetize your idea, adding further testing and review to evaluate if your plan could really work, and you can indeed launch your business
  5. Devoting the time to either hiring a business plan writer or writing it yourself demonstrates commitment to your audience – as you present your idea to potential business partners, investors or potential employees; the presentation of a written plan shows your audience that you have invested time, effort and resources into your plan, so it will be viewed more seriously

Hiring a business plan writer as a third party to challenge your thoughts and evaluate if your plan could really work is a great way to test your vision and lay out all your cards on the table. Getting a third party involved lets investors know how serious and committed you are, just as writing down goals improves the likelihood that you will accomplish your goals.

 

Gordon Benzie is a marketing communications professional and business plan adviser that specializes in preparing and executing upon business plans and marketing strategies. Gordon can be found on Google+

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